In a major legal setback to the state's medical-marijuana community, the Arizona Court of Appeals has ruled that cannabis extracts commonly sold in state dispensaries are illegal.

The ruling affects what the court and Arizona law calls "hashish," or the resin extracted from marijuana. Medical marijuana consumers also know it as hash oil, shatter, wax, and other names. It's become one of the biggest sellers at the state's dispensaries, used to fill vape cartridges and create most cannabis-infused food and drinks.

It's also the main ingredient in the cannabis oil used by many parents to treat epileptic children.

The appeals court found in a 2-1 decision that the Arizona Medical Marijuana Act doesn't address hashish.

Rodney Jones, a medical marijuana patient from Chino Valley, served prison time in 2017 for possessing hashish — something for sale in dispensaries across the state.

Arizona Department of Corrections

"AMMA is silent as to hashish," wrote Judge Jon W. Thompson for the majority opinion. "Prior understanding of the pertinent words strongly indicates that AMMA in no way immunizes the possession or use of hashish. That AMMA immunizes medical use of a mixture or preparation of the marijuana plant does not immunize hashish."

The ruling affirmed the conviction of Rodney Jones for possessing a small amount of hashish in a jar. Yet Jones was a valid, card-holding patient when he was arrested in 2013. He was sentenced to 2.5 years behind bars, with credit for 366 days in jail.

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Because so much money is at stake, dispensaries are unlikely to pull products from their shelves without a final ruling from the Arizona Supreme Court. But as one legalization advocate put it, the latest ruling is "big news" in the cannabis industry.

Despite the shelves full of "hashish" in Arizona dispensaries today, the AMMA approved narrowly by voters in 2010 didn't specifically legalize the resin in cannabis buds.

Instead, the 2010 law defined the "usable marijuana" that patients could legally use as "the dried flowers of the marijuana plant, and any mixture or preparation thereof, but does not include the seeds, stalks, and roots of the plant ..."

This became a problem because a separate state law makes it illegal to possess "cannabis, a narcotic drug." And cannabis is defined as the resin extracted from marijuana.

That resin is also called hashish, or hash oil, if it's in liquid form. It contains the THC molecule that produces most of marijuana's psychoactive effects, and it can be extracted — typically from buds, which contain more resin than leaves or stalks — in numerous ways, including heating it, squeezing it, or stripping it out with chemicals like butane or carbon dioxide. The basic idea is the same as making olive oil out of olives — that is, nothing in hashish or cannabis resin was not present in the original plant.

CBD oil, now sold online in all 50 states, is also an extract of the cannabis sativa plant's resin that would be illegal under the appeals court decision.

Cannabis prohibitionists like Maricopa County Attorney Bill Montgomery and Yavapai County Attorney Sheila Polk have in the past used the differing definitions like a loophole for prosecution. Montgomery once threatened that anyone in possession of cannabis extracts would be prosecuted. "Cannabis," under state law, merits a stiffer felony designation and higher penalties than regular marijuana, even though science says it's all the same substance.

The parents of a boy with epilepsy won a ruling in 2014 against Montgomery's position in Maricopa County Superior court. Judge Katherine Cooper ruled that the Act's wording means extracts like hashish are legal for qualified patients.

But others have disagreed, and the Maricopa County decision wasn't precedent-setting. As Phoenix New Times covered in October, a Navajo County Superior Court judge ruled against a suspect who had a medical marijuana card and claimed to have purchased vape cartridges with hash oil legally at a state-authorized dispensary.

The judge eventually changed his mind and the suspect's possession charge was dropped, New Times reported in March. But the case raised awareness in the state's medical-marijuana community and put patients on notice that the basic legal question had still not been settled. New Times related how experts were worried about Rodney Jones' case, which was pending at the time.

Court records show that Jones, 26, was arrested in 2013 at the Prescott Resort and charged with possession of 1.43 grams of "cannabis."

The AMMA allows patients to possess up to 2.5 ounces of marijuana. But what is marijuana? Is it the same thing as cannabis? It starts to get confusing.

His lawyer, Craig Williams, filed a motion to dismiss the case in 2014. Polk filed a counter-motion, arguing that the AMMA had not legalized "hashish."

A Yavapai judge pointed out after a 2015 evidentiary hearing that Cooper's ruling did not specifically address how state statute defined the narcotic "cannabis," and denied Jones' motion to dismiss.

Jones was then convicted in Yavapai County Superior Court, and finally freed from prison on June 26, 2017, records show.

"The State argues that by not specifically including extracted resin within its description of immunized marijuana, AMMA adopts the 'preexisting law distinguishing between cannabis and marijuana.' We agree," the majority found in the new appeals court ruling. "We construe statutory language in light of existing understanding."

The judges cited a 1978 Arizona Supreme Court case that gave a thumbs-up to separating hashish from marijuana in state law, quoting the earlier court: "We have held that our legislature’s differing treatment of hashish and marijuana is to be attributed to the great potency of the former, rendering it 'susceptible to serious and extensive abuse.'"

"'Mixture or preparation' means the combining of marijuana with non-marijuana elements to make 'consumables' such as brownies and the like," the judges assert. "Hashish, by contrast, is processed from the separated or extracted resin."

The judges then chided the authors of the AMMA for not being clearer: "If the drafters wanted to immunize the possession of hashish they should have said so ... We cannot speculate that the voters, in allowing the limited use of marijuana to ameliorate patients’ suffering and distress, would, if they also intended to similarly immunize the use of hashish, have allowed the same quantity of narcotics as of the relatively benign flowers of the marijuana plant."

Judge Kenton Jones, who wrote the dissenting opinion, argued that the AMMA's definition of marijuana should not be interpreted narrowly, nor joined to another statute that would weaken the voter-approved law.

"The AMMA does define 'marijuana' for purposes of delineating the bounds of its grant of immunity, and a prior understanding of the term, memorialized in a separate section of the code, cannot supplant that definition," Jones wrote.

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"I expect an uproar," he said. "You can guesstimate that about 40 percent of the market is based on some kind of concentrate. Vape pens, wax, topicals, edibles — it's all concentrated marijuana. The bottom line of the industry is threatened."

Ray Stern has worked as a newspaper reporter in Arizona for more than two decades. He's won many awards for his reporting, including the Arizona Press Club's Don Bolles Award for Investigative Journalism.

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